New Tuen Ma Line will cushion home prices fall in Tai Wai & Diamond Hill
Developers will price new projects more aggressively in the area
HONG KONG, 3 February 2020 – Property markets in Tai Wai and Diamond Hill are expected to be benefited from the opening of the first phase of Tuen Ma Line, according to JLL’s latest Residential Market Monitor released today. Housing prices in these districts are likely to hold up better than the broader market.
Phase 1 of Tuen Ma Line will commence service on 14 February 2020. With the new opening of three stations, Hin Keng, Diamond Hill and Kai Tak station, the new railway connects Tai Wai to Diamond Hill in only 9 minutes, compared to 17 minutes in the past.
The realisation of new railway infrastructure has traditionally been said to serve as an impetus for residential price growth in the districts that benefit and boost demand for commercial amenities. Figures from JLL show, residential prices in Whampoa increased by 21% in twelve months after the Kwun Tong line extension opened in 2016.
Henry Mok, senior director of Capital Markets at JLL in Hong Kong, said: “There is capacity for residential prices in Tai Wai to further expand after the opening of the new railway, especially towards the opening of Phase 2 when there is a direct linkage to Hung Hom station in 2021. We expect developers to price new projects more aggressively and secondary homeowners to also hold firmer on asking prices in the area.
JLL forecasts there will be around 3,070 units to be completed in Tai Wai in the coming two years. This includes 3,000 units at a project atop Tai Wai station, jointly developed by New World Development and MTR Corp, which is likely to be launched for sale this year.
Yet, a milder “MTR effect” for the Kai Tak area is expected, as buyers have mostly factored in this key advantage from infrastructure in purchase decisions for this new development area.
Nelson Wong, Head of Research at JLL in Greater China and Hong Kong, said: “Over the short term, we maintain our view that downgrading economic factors and unresolved political issues will continue to weigh on mass residential capital values, leading to a drop of 10-15% in 2020. But prices in districts that will benefit from the “MTR effect” are likely to hold up better than the broader market.”
JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. Our vision is to reimagine the world of real estate, creating rewarding opportunities and amazing spaces where people can achieve their ambitions. In doing so, we will build a better tomorrow for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $16.3 billion, operations in over 80 countries and a global workforce of more than 93,000 as of September 30, 2019. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit jll.com.